At McBrien Armistead Law Group, we understand that planning for long-term care is a critical aspect of estate planning. One of our most frequent questions is: “Can a nursing home take your house if it is in a trust?” This blog post addresses this concern and provides broad information on protecting your assets from a nursing home. If you have specifics, please get in touch with our office. Every case is unique, and you should discuss your case with our legal professionals for specific information.
Understanding Trusts
A trust is a legal arrangement where one party, known as the trustee, holds assets for the benefit of another party, the beneficiary. There are two primary types of trusts: revocable and irrevocable.
Revocable Trusts
In a revocable trust, the grantor (who establishes the trust) maintains control over the assets and can modify or dissolve the trust at any time. However, since the grantor retains ownership of the assets, a revocable trust does not protect these assets from a nursing home.
Irrevocable Trusts
On the other hand, an irrevocable trust involves the grantor relinquishing control over the trust’s assets. Once assets are placed into an irrevocable trust, they no longer belong to the grantor but to the trust itself. This type of trust can protect your assets from a nursing home because the assets are no longer considered part of your estate.
Can a Nursing Home Take Your House?
When protecting your home from being claimed by a nursing home, whether it is safe depends on how your assets are structured. If your house is in an irrevocable trust, a nursing home cannot take it because it is no longer considered your asset. Conversely, if your home is in a revocable trust, it will not be protected from nursing home costs because you still technically own the assets.
After a Loved One Passes: What Can a Nursing Home Claim?
If your loved one passes away while in a nursing home, what the nursing home can claim depends on the individual’s financial arrangements. If the deceased was privately paying for their care, the nursing home could potentially make a claim against the estate for unpaid bills. However, if assets were adequately placed into an irrevocable trust, they would typically be protected from such claims.
Protect Your Assets
Planning is crucial to protect your assets and pass them down to your loved ones as intended. Establishing an irrevocable trust can be a valuable tool in this process. However, it’s important to remember that transferring assets into an irrevocable trust must be done at least five years before applying for Medicaid to avoid penalties.
Navigating the complexities of estate planning and elder law can be daunting. At McBrien Armistead Law Group, we’re committed to providing our clients with advice tailored to their unique circumstances. Whether you have questions about trusts, asset protection, or planning for long-term care, we’re here to guide you every step of the way.
